Global Legal Monitor

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(Dec. 8, 2016) The Investigatory Powers Tribunal ruled on October 17, 2016, that the British Intelligence Agencies unlawfully collected the confidential personal data of British citizens in bulk for 17 years, from 1998 to 2015, when the activities were publicly acknowledged. (Privacy International v. Secretary of State for Foreign and Commonwealth Affairs, [2016] UKIPTrib 15_110-CH.) The ruling was declared “one of the most significant indictments of the secret use of the government’s mass surveillance powers since Edward Snowden first began exposing the extent of British and American state digital surveillance of citizens in 2013.” (Alan Travis, UK Security Agencies Unlawfully Collected Data for 17 Years, Court Rules, GUARDIAN ( Oct. 17, 2016).) The data collected included phone and Internet traffic and communications data. (Id.; Privacy International v. Secretary of State for Foreign and Commonwealth Affairs, supra.)

Particulars of the Case

The Intelligence Services claimed that the rules governing the use of bulk data were not defined in legislation, but the authority of the agencies to collect such information was provided for under the Intelligence Services Act 1994 and the Security Service Act 1989; it used the authority provided by these Acts in accordance with section 94 of the Telecommunications Act 1984. (Privacy International v. Secretary of State for Foreign and Commonwealth Affairs et al., ¶ 6; Intelligence Services Act 1994, c. 13, LEGISLATION.GOV.UK; Security Service Act 1989, c. 5, LEGISLATION.GOV.UK; Telecommunications Act 1984, c. 12, LEGISLATION.GOV.UK; Intelligence and Security Committee of Parliament, Privacy and Security: A Modern and Transparent Legal Framework, 2014-15, H.C. 1075, at 157.)

The legal challenge focused on the acquisition, use, retention, and disclosure of bulk communications data (BCD) by the security services under directions issued under section 94 of the Telecommunications Act 1984, and the use of this data. The Tribunal noted the highly secretive nature of the communications data regime, saying “it seems difficult to conclude that the use of BCD was foreseeable by the public when it was not explained to parliament.” (Privacy International v. Secretary of State for Foreign and Commonwealth Affairs et al., ¶ 70.)

The Ruling

The Tribunal found that the collection of the BCD did not comply with article 8 of the European Convention on Human Rights until the issuance of an “official handling arrangement” regulating how the collection, management, and destruction of such data should be managed, after which point the Tribunal held that the regime was compliant. (Id. ¶ 101.) The recently enacted Investigatory Powers Act 2016 will serve to place these powers on a clear, statutory basis. (Investigatory Powers Act 2016, c. 25, LEGISLATION.GOV.UK; Clare Feikert-Ahalt, United Kingdom: Controversial Surveillance Act Receives Royal Assent, GLOBAL LEGAL MONITOR (Dec. 8, 2016).)

(Dec. 8, 2016) The Investigatory Powers Act, which has been under consideration for the past year and in various forms for the past few years, was recently enacted into law when it received Royal Assent. It was introduced in draft form in autumn of 2015 (Draft Investigatory Powers Bill 2015, 2015-16 Cm. 9152, GOV.UK), as a 192-page bill; it has now been enacted as a 304-page Act (Investigatory Powers Act 2016, c. 25, LEGISLATION.GOV.UK).

Drafted in the wake of the disclosures by Edward Snowden, including that the government was conducting mass surveillance on United Kingdom citizens, the Act is expansive and covers a wide range of surveillance activities, including acquisition of communications data, equipment interference, and requirements for retaining and accessing bulk information. It aims to clearly define the powers of the intelligence services and police, some of which have been used for a number of years without lawful authority.

Overview of Surveillance Powers

The Act introduces procedures for law enforcement and intelligence services to undertake equipment interference to access individuals’ electronic devices, including their computers, to obtain data such as communications via texts and email and geolocation. (House of Commons Library, Investigatory Powers Bill, Briefing Paper No. 7518, Mar. 11 2016, Parliament website.) Bulk data may now be collected and examined with a warrant authorized by a senior law enforcement officer and approved by a Judicial Commissioner, if it is necessary and proportionate on the grounds of national security, to prevent or detect serious crime, or in the interests of the economic well-being of the UK. Permitting the government to collect and retain bulk data by communications providers for up to a year and the requirement to provide this data to the securities services if issued with a notice and to remove encryption if requested are among the most contentious aspects of the Act. (Id.; ‘Extreme Surveillance’ Becomes UK Law with Barely a Whimper, GUARDIAN (Nov. 19, 2016).)

Section 253 enables the Secretary of State to impose obligations on communications service providers in the form of technical capability notices, to facilitate assistance to warrants issued under specified parts of the Investigatory Powers Act. It further provides that such obligations may include the removal of electronic protection applied by an operator, or any third party acting on their behalf, to any data or communications. When making these notices, the Secretary of State is required to take into account the technical feasibility and cost of compliance, and section 249 provides that communications service providers would receive a contribution towards any costs they incurred to comply with the measure. (Investigatory Powers Act 2016.)

Privacy Concerns

Given the intrusive nature of the powers included in this Act, privacy advocates have been highly critical of it. These concerns were addressed in part in amendments to the Act, notably one from the Lords that inserted a statement in section 1 of the Act that reads “[t]his Act sets out the extent to which certain investigatory powers may be used to interfere with privacy.” (Id.;Investigatory Powers Bill Published: Minimal Changes Are Not Even Cosmetic, Privacy International website (Mar. 1, 2016).) Amid arguments that the Act did not sufficiently address privacy concerns, Lord Janvrin, who introduced this amendment in an attempt to place privacy at the forefront of the Act, noted “[t]hat there is merit in placing a simple statement right at the forefront of the legislation to provide additional clarity that there should be no doubt that privacy protection remains a fundamental priority.” (774 Parl. Deb. H.L (5th ser.) (2016) 1789, Parliament website.) Further provisions were included in the Act that require public authorities to have regard to a number of factors relating to privacy, including whether the objectives could be achieved by other, less intrusive means, prior to requesting a warrant, authorization, or notice. (Investigatory Powers Act 2016, section 2.)

Other Criticisms

The Executive Director of Open Rights Group has stated that the Act provides for “a surveillance law that is more suited to a dictatorship than a democracy. The state has unprecedented powers to monitor and analyse UK citizens’ communications regardless of whether we are suspected of any criminal activity.” (‘Extreme Surveillance’ Becomes UK Law with Barely a Whimper, supra.) The Act met considerable resistance both within the government and in private industry, representatives of which are concerned not only about the Act’s requirement that law enforcement and intelligence services be able to access an unprecedented number of communications, but also about the negative impact it could have on the UK’s technology industry. (Id.)

Recommendations from the committee reviewing the Act note that the government should make it explicit that providers of “end-to-end encrypted communication or other un-decryptable communication services will not be expected to provide copies of those communications if it is not practicable for them to do so.” (House of Commons Library, supra, at 71.) Concerns were also raised that the language used in this would result in the prohibition of end-to-end encryption in the UK and the government was urged to clarify the nature of the obligations that would be imposed by the Act. The government responded that a Code of Practice will contain further details as to the necessity and proportionality of imposing these requirements on communications service providers. (Id. at 42.)

(Dec. 7, 2016) On November 26, 2016, the Iraqi Parliament institutionalized the people’s fighting forces known as Al-Hashd al-Shaabi, or the Popular Mobilization (PM), by passing a special law on the matter. (Law of the Popular Mobilization Authority (2016 Law), Iraqi Parliament website (Nov. 26, 2016) (in Arabic).)

Under the new law, the PM is an independent organization with corporate personality, is a part of the Iraqi armed forces, and reports directly to the general commander of the armed forces. (Id. art 1.1.) The PM is subject to all military laws in effect except those related to age and education requirements. (Id. art 1.2.1.) Members of the PM must be disengaged from all political, partisan, and social organizations, and no political activity by those members is permitted. (Id. art 1.2.5.) The commander of the PM will be appointed with the approval of the Parliament. (Id. art 2.)

The 2016 law replaces an executive order on the PM issued earlier this year by the Prime Minister, Haider al-Ibadi, in his capacity as the Commander-in-Chief of the armed forces. (Order No. 91 (Feb. 2, 2016), IKH NEWS (July 26, 2016) (in Arabic).)

(Dec. 7, 2016) On November 10, 2016, public prosecutors in Bahrain brought three charges against Mohamed al-Tajer, an attorney and human rights activist. The charges are insulting government institutions, inciting hatred against a religious group, and misusing telecommunications. (Bahrain: Human Rights Lawyer Charged, Human Rights Watch website (Dec. 1, 2016).) These charges are based on three separate articles of the Penal Code. (Id.; Bahrain Penal Code 1976, arts. 172, 216, & 290, United Nations Office on Drugs and Crime website.) No trial date has yet been set; if convicted, al-Tajer could be sentenced to up to five years of imprisonment. (Elizabeth Lowman, Bahrain Human Rights Lawyer Charged with Insulting Government, PAPER CHASE (Dec. 1, 2016).)

One of al-Tajer’s private messages, sent via WhatsApp earlier this year and cited by prosecutors, stated “[i]t’s clear that there’s a team in the public prosecution and Cybercrimes division whose only job is to sit at computers and intercept every word about Sunnis, Saudi Arabia, hatred of the regime, or insults against the king.” (Bahrain: Human Rights Lawyer Charged, supra.) Al-Tajer stated that prosecutors also focused on tweets he sent in January and February 2016, which called the government a “regime of prohibition” and stated “history tells stories of falling dictators, but the lesson is never learnt #bahrain.” (Id.)

Human Rights Watch has criticized the Bahrain government for making peaceful opposition to the regime a serious violation of freedom of expression. Following the arrest, the organization’s Deputy Director for the Middle East, Joe Stork, noted:

Bahraini authorities have targeted journalists, activists, clerics, and politicians for peaceful dissent in the last few months, so it was only a matter of time before they came for the lawyers. … Al-Tajer is facing charges because he stated the obvious: Bahraini authorities are snooping on their citizens and anyone who steps out of line online faces jail time. … These charges against Mohamed al-Tajer appear to confirm his suspicions about the authorities’ surveillance activities and betray their woeful disregard for free speech. (Bahrain: Human Rights Lawyer Charged, supra.)

Background

In 2011, following the uprising in the country that was associated with the “Arab Spring” movement, Bahrain responded to criticism of the state of human rights in the country by establishing two oversight bodies, the Ombudsman in the Ministry of the Interior and a Special Investigations Unit. While the government has pointed to these organizations as being successful in protecting human rights, Amnesty International disagrees, recently stating that “[m]uch work is still needed to break the country’s long-standing culture of impunity. The Ombudsman and the Special Investigations Unit need to urgently address their failings if they are not to lose credibility.” (Id.; Bahrain: Window-Dressing or Pioneers of Change?: An Assessment of Bahrain’s Human Rights Oversight Bodies, Amnesty International website (Nov. 21, 2016); for background on the 2011 uprising, see Kelly McEvers, Bahrain: The Revolution That Wasn’t, NPR (Jan. 5, 2012).)

Al-Tajer was previously detained for four months and convicted in 2011 of inciting hatred against the government, and although the conviction was overturned on appeal, he has asserted that he was tortured in detention. The same year his brother, a safety engineer working in construction, was arrested on charges of “joining an illegal terrorist organization to overthrow the government by force” and “training individuals on the use of weapons for terrorist purposes.” (Bahrain: Human Rights Lawyer Charged, supra.) He, too, has alleged that he was tortured. (Id.)

(Dec. 7, 2016) On December 1, 2016, on the last parliamentary sitting day of the year, the Australian Parliament voted to pass a bill establishing a 15% income tax rate for temporary foreign workers known as“working holiday makers” (WHMs, or “backpackers”) commonly referred to as the “backpacker tax.” The tax rate to be applied to those who engage in short-term employment in Australia under certain visas has been a controversial issue for the past 18 months, with farmers concerned about the possible negative impact of a higher tax rate on the number of seasonal workers available for upcoming harvests. (See Farmers Tell Canberra Backpacker Tax Reality, FARM ONLINE (Nov. 21, 2016).)

The visas allow holders to holiday (i.e. vacation) and work in Australia for up to a year. Holders are generally restricted from working for the same employer for more than six months. The main purpose of the visas is to encourage “cultural exchange and closer ties between Australia and eligible countries.” (Working Holiday Visa (Subclass 417), supra; Working Holiday Visa (Subclass 462), supra.) In addition, “[t]he programme helps Australian regional employers by encouraging working holiday visa holders to seek short-term and casual work in specified industries in regional Australia.” (Fact Sheet – Working Holiday Visa Programme, DIBP (last visited Dec. 2, 2016).) Those who perform “specified work in an eligible regional Australian area for a minimum of three months” may be eligible for a second visa under the program. (Id.) “Regional Australia” refers to towns, small cities, and areas outside of the major capital cities. (What is Regional Australia?, REGIONAL AUSTRALIA INSTITUTE (last visited Dec. 5, 2016).)

2015-2016 Budget Proposal and Subsequent Review

In the 2015-2016 Budget, released in May 2015, the government proposed “to change the tax status of temporary working holiday makers from that of resident, to that of non-resident, from 1 July 2016.” (Les Nielsen, Changed Rules for Working Holiday Makers, in Parliamentary Library, Budget Review 2015-16 (May 2015), Parliament of Australia website.) Under the resident tax approach, the earnings of foreign workers on the relevant visas would be exempt from income tax up to AU$18,200 (about US$13,460). Earnings between AU$18,201 and AU$37,000 (about US$27,370)would be taxed at a rate of 19%, with higher marginal rates applying to subsequent higher amounts. (Id.) Administrative Appeals Tribunal rulings in March 2015 indicated that some WHMs may not qualify as Australian residents and therefore backpackers could not automatically claim the tax-free threshold. (11 Mar 15 Backpacker Not Resident of Australia Under 183 Day Test – Re Koustrup, THE TAX INSTITUTE (Mar. 11, 2015).)

A non-resident tax approach would see WHMs being taxed at the rate of 32.5% for earnings up to AU$80,000. (Nielson, supra.)

Several concerns were raised following the release of the government’s proposal:

this new policy could substantially increase the incentives for tax evasion; and

the number of working holiday makers may diminish rapidly as soon as visa holders perceive there is less economic benefit to undertaking work that most Australians are reluctant to do, such as picking fruit, cleaning and casual hospitality

The new income tax policy could end up hurting Australian companies that will find it hard to fill job vacancies without a cheap and casual visiting workforce.

Meanwhile, the tourism industry is concerned because backpackers, who are more likely to go to regional areas and are relatively high-spending tourists, will be less likely to visit Australia and will go instead to New Zealand, Canada or South Africa. At the same time, the industry relies heavily on working holiday makers as a labour force. (Id.)

Elements of the government’s proposed packaged that were included in the bills were to:

apply a 19 per cent tax rate to the taxable income of WHMs on amounts up to $37,000, with ordinary tax rates and thresholds applying thereafter

increase tax on the Departing Australia Superannuation Payment to 95 per cent [from either 0%, 35%, or 45%, depending on the composition of the balance of the member’s superannuation (i.e., pension)]

increase the passenger movement charge by five dollars [from $55 to $60]

reduce the application charge for WHM visas by $50 [from $440 to $390]

create a register of employers of WHMs, which will be used to enable tax to be withheld at the lower 19 per cent rate

provide for the Commissioner of Taxation to prepare an annual report to the Treasurer, for presentation in Parliament, which includes statistics and information derived from the register, and

allow the Commissioner to disclose to the Fair Work Ombudsman (FWO) information that is relevant to ensuring an entity’s compliance with the appropriate employment arrangements. (Swoboda & Dossor, supra.)

Other elements that would require other implementation processes include:

funding for Tourism Australia to promote Australia as a potential destination for WHMs through a $10 million global youth targeted advertising campaign

change visa conditions so that an employer with premises in different regions is able to employ a WHM for 12 months, with the WHM working up to six months in each region

change visa conditions so that the eligibility age for a WHM visa is lifted from age 30 to age 35. (Id.)

Consideration of the Bills by the Parliament

The government hoped for swift passage of the relevant bills by the Parliament, with a failure to pass the bills meaning that the tax rate for WHMs would default to 32.5% on January 1, 2017. However, the Labor Party argued that because the bills included measures not previously scrutinized, they should be referred to a Senate committee. (Anna Vidot, Backpacker Tax: Labor Blames ‘Government Incompetence’ for Delay, ABC News (Oct. 13, 2016).) The Senate Standing Committee on Economics subsequently completed its inquiry on November 11, 2016. (Working Holiday Maker Reform Package, SENATE STANDING COMMITTEE ON ECONOMICS, PARLIAMENT OF AUSTRALIA (last visited Dec. 2, 2016).) In the meantime, the House of Representatives voted to pass the bills on October 17, 2016. (See, e.g., Income Tax Rates Amendment (Working Holiday Maker Reform) Bill 2016, PARLIAMENT OF AUSTRALIA (last visited Dec. 2, 2016).)